Correlation Between Bank of America and LOEWS
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By analyzing existing cross correlation between Bank of America and LOEWS P 6, you can compare the effects of market volatilities on Bank of America and LOEWS and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Bank of America with a short position of LOEWS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and LOEWS.
Diversification Opportunities for Bank of America and LOEWS
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and LOEWS is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and LOEWS P 6 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOEWS P 6 and Bank of America is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Bank of America are associated (or correlated) with LOEWS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOEWS P 6 has no effect on the direction of Bank of America i.e., Bank of America and LOEWS go up and down completely randomly.
Pair Corralation between Bank of America and LOEWS
Considering the 90-day investment horizon Bank of America is expected to generate 1.21 times more return on investment than LOEWS. However, Bank of America is 1.21 times more volatile than LOEWS P 6. It trades about 0.06 of its potential returns per unit of risk. LOEWS P 6 is currently generating about 0.01 per unit of risk. If you would invest 3,085 in Bank of America on August 29, 2024 and sell it today you would earn a total of 1,692 from holding Bank of America or generate 54.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 78.63% |
| Values | Daily Returns |
Bank of America vs. LOEWS P 6
Performance |
| Timeline |
| Bank of America |
| LOEWS P 6 |
Bank of America and LOEWS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and LOEWS
The main advantage of trading using opposite Bank of America and LOEWS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, LOEWS can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in LOEWS will offset losses from the drop in LOEWS's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. JPMorgan Chase Co |
| LOEWS vs. Empresa Distribuidora y | LOEWS vs. Stevanato Group SpA | LOEWS vs. Suburban Propane Partners | LOEWS vs. Acco Brands |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Managers module to screen money managers from public funds and ETFs managed around the world.
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